B-214191, AUG 27, 1984, 84-2 CPD 227

B-214191, AUG 27, 1984, 84-2 CPD 227

CONTRACTS - NEGOTIATION - REQUEST FOR PROPOSALS - BRAND NAME "OR EQUAL" PROCEDURE - UNDULY RESTRICTIVE DIGEST: 1. PROTEST ALLEGING THAT A BRAND NAME PURCHASE DESCRIPTION WAS UNDULY RESTRICTIVE IS DENIED WHERE AGENCY SHOWS THAT AT THE TIME THE DECISION WAS MADE, IT HAD REASON TO BELIEVE THAT ONLY THE BRAND NAME PRODUCT COULD MEET ITS NEEDS. CONTRACTS - NEGOTIATION - OFFERS OR PROPOSALS - REJECTION - ANTICIPATED PROFITS CLAIM 2. THERE IS NO LEGAL BASIS FOR ALLOWING AN UNSUCCESSFUL OFFEROR TO RECOVER LOST INCOME OR PROFITS, LEGAL FEES IN PURSUING A BID PROTEST OR OTHER DIRECT AND INDIRECT COSTS OTHER THAN PROPOSAL PREPARATION COSTS. CONTRACTS - NEGOTIATION - OFFERS OR PROPOSALS - PREPARATION - COSTS ARBITRARY AND CAPRICIOUS GOVERNMENT ACTION 3. PROTESTER'S CLAIM FOR PROPOSAL PREPARATION COSTS IS DENIED BECAUSE THERE IS NO SHOWING THAT THE GOVERNMENT ACTED ARBITRARILY OR CAPRICIOUSLY IN RELATION TO PROTESTER'S PROPOSAL.

TOM SHAW, INC.:

TOM SHAW, INC. (SHAW), PROTESTS THE SPECIFICATIONS AND THE AWARD OF A CONTRACT, UNDER REQUEST FOR PROPOSALS (RFP) NO. N62472-84-R-6514, ISSUED BY THE NAVAL FACILITIES ENGINEERING COMMAND, DEPARTMENT OF THE NAVY (NAVY), FOR THE REPAIR OF THE WOODEN ARCH SUPPORTS OF FIVE BUILDINGS. SHAW ALSO CLAIMS REIMBURSEMENT FOR ITS LOSS OF INCOME AND PROFITS AND ALL OTHER DIRECT AND INDIRECT COSTS INCLUDING PROPOSAL PREPARATION COSTS.

WE DENY THE PROTEST AND THE CLAIM.

THE SOLICITATION AS ORIGINALLY ISSUED REQUIRED THAT THE WOOD BE TREATED WITH OSMOSE 24-12 LIQUID WOOD PRESERVATIVE OR APPROVED EQUAL. AMENDMENT 0006 ELIMINATED THE POSSIBILITY OF OFFERORS SUBMITTING AN APPROVED EQUAL. SHAW CONTENDS THAT AMENDMENT 0006 CREATED AN UNDULY RESTRICTIVE SPECIFICATION BECAUSE IT WAS PRECLUDED FROM OFFERING A PRODUCT OF ITS SUPPLIER WHICH ALLEGEDLY IS EQUAL TO OSMOSE 24-12 AND WHICH WOULD PROVIDE A SUBSTANTIAL SAVINGS TO THE GOVERNMENT.

THE CONTRACTING AGENCY HAS THE PRIMARY RESPONSIBILITY FOR DETERMINING ITS NEEDS AND FOR DRAFTING REQUIREMENTS WHICH REFLECT THOSE NEEDS. ROMAR CONSULTANTS, INC., B-206489, OCT. 15, 1982, 82-2 CPD PARA. 339. THE CONTRACTING AGENCY IS MOST FAMILIAR WITH THE CONDITIONS UNDER WHICH THE SERVICES OR SUPPLIES HAVE BEEN AND WILL BE USED. OUR OFFICE WILL NOT DISTURB AN AGENCY DECISION CONCERNING THE BEST METHOD OF ACCOMMODATING ITS NEEDS ABSENT CLEAR EVIDENCE THAT THE DECISION IS ARBITRARY OR OTHERWISE UNREASONABLE. SEE INTERSTATE COURT REPORTERS, B-208881.2, FEB. 9, 1983, 83-1 CPD PARA. 145. WHILE AGENCIES SHOULD FORMULATE THEIR NEEDS SO AS TO MAXIMIZE COMPETITION, SPECIFICATIONS WHICH LIMIT COMPETITION ARE NOT UNDULY RESTRICTIVE SO LONG AS THEY REFLECT THE GOVERNMENT'S LEGITIMATE MINIMUM NEEDS. SEE PITTCON PREINSULATED PIPES CORPORATION, B-209940.2, JULY 11, 1983, 83-2 CPD PARA. 70. GENERALLY, WHEN A SPECIFICATION HAS BEEN CHALLENGED AS UNDULY RESTRICTIVE OF COMPETITION, IT IS INCUMBENT UPON THE PROCURING AGENCY TO ESTABLISH PRIMA FACIE SUPPORT FOR ITS CONTENTION THAT THE RESTRICTIONS IT IMPOSES ARE REASONABLY RELATED TO ITS NEEDS. BUT ONCE THE AGENCY ESTABLISHES THIS SUPPORT, THE BURDEN IS THEN ON THE PROTESTER TO SHOW THAT THE REQUIREMENTS COMPLAINED OF ARE CLEARLY UNREASONABLE. S.A.F.E. EXPORT CORPORATION, B-207655, NOV. 16, 1982, 82 2 CPD PARA. 445.

HERE, THE NAVY HAS ESTABLISHED PRIMA FACIE SUPPORT FOR ITS USE OF THE OSMOSE 24-12 PROPRIETARY SPECIFICATION. IN ACCORDANCE WITH THE PROVISIONS OF DEFENSE ACQUISITION REGULATION, SEC. 1-1206.1(B)(I), REPRINTED IN 32 C.F.R. PTS. 1-39 (1983), THE NAVY AMENDED THE SOLICITATION TO BRAND NAME ONLY BECAUSE EXTENSIVE RESEARCH PRIOR TO THE CLOSING DATE INDICATED THAT NO OTHER PRODUCTS WERE EQUAL TO OSMOSE 24 12.

THE NAVY ADMITS THAT IF IT HAD BEEN INFORMED TIMELY OF THE PROTESTER'S PROPOSED PRODUCT, IT MAY HAVE FOUND IT TO BE AN ACCEPTABLE ALTERNATIVE TO OSMOSE 24-12. HOWEVER, WHILE SHAW DID ADVISE THE AGENCY OF THE NAME OF ITS PROPOSED SUPPLIER, SHAW FAILED TO INFORM THE NAVY OF THE IDENTITY OF ITS PROPOSED PRODUCT UNTIL OVER 2 MONTHS AFTER IT FILED ITS PROTEST AND WELL AFTER AWARD. PRIOR TO THE CLOSING DATE, THE NAVY HAD CONTACTED A REPRESENTATIVE OF THE PROTESTER'S SUPPLIER, WHO FAILED TO INDICATE THAT THE SUPPLIER SOLD A PRODUCT WHICH WAS EQUAL TO OSMOSE 24-12.

ALTHOUGH SHAW PROTESTED TO THE NAVY AGAINST THE BRAND NAME ONLY PURCHASE DESCRIPTION, FOR REASONS KNOWN ONLY TO SHAW, IT DID NOT TELL THE NAVY WHAT ITS PROPOSED PRODUCT WAS. THE NAVY HAD ALREADY DETERMINED THAT NO ACCEPTABLE PRODUCT OF THE PROTESTER'S SUPPLIER WAS AVAILABLE. GIVEN SHAW'S FAILURE TO IDENTIFY ITS PROPOSED EQUAL, THE AGENCY WAS NOT AWARE THAT SHAW WAS IN FACT PLANNING TO SUPPLY A DIFFERENT PRODUCT OF THE SUPPLIER OR THAT A DIFFERENT PRODUCT WAS EQUAL TO THE OSMOSE 24-12 PRODUCT, AND THE NAVY REASONABLY BELIEVED THAT SHAW COULD NOT SUPPLY AN EQUAL TO THE OSMOSE 24-12 PRODUCT. BASED UPON THIS, IT WAS REASONABLE FOR THE NAVY TO CONCLUDE THAT THERE WAS NO "EQUAL" TO OSMOSE 24-12 AND THAT THE PURCHASE DESCRIPTION SHOULD REMAIN LIMITED TO THE BRAND NAME PRODUCT.

ALTHOUGH HINDSIGHT MAY INDICATE THAT THE SPECIFICATION WAS MORE RESTRICTIVE THAN IF NEEDED TO BE, SHAW HAS FAILED TO SHOW THAT THE DECISION TO RESTRICT THE PURCHASE DESCRIPTION TO A BRAND NAME ONLY TYPE WAS NOT REASONABLY BASED AT THE TIME IT WAS MADE. SEE AYDIN VECTOR DIVISION, B-194173, MAY 14, 1979, 79-1 CPD PARA. 345.

THE PROTEST IS DENIED.

SHAW ALSO HAS REQUESTED REIMBURSEMENT FOR LOST INCOME AND PROFITS AND ALL DIRECT AND INDIRECT COSTS INCLUDING PROPOSAL PREPARATION COSTS. WHILE PROPOSAL PREPARATION COSTS ARE RECOVERABLE UNDER APPROPRIATE CIRCUMSTANCES, THERE IS NO LEGAL BASIS FOR ALLOWING AN UNSUCCESSFUL OFFEROR TO RECOVER LOST INCOME OR ANTICIPATED PROFITS, LEGAL FEES INCURRED IN PURSUING A BID PROTEST, OR OTHER DIRECT AND INDIRECT COSTS. SEE M.L. MACKAY & ASSOCIATES, INC., B-208827, JUNE 1, 1983, 83-1 CPD PARA. 587.

THE COSTS OF PREPARING A PROPOSAL MAY BE RECOVERED PROVIDED THAT THE CLAIMANT CAN SHOW THAT THE GOVERNMENT ACTED ARBITRARILY OR CAPRICIOUSLY AND THAT IT HAD A SUBSTANTIAL CHANCE OF RECEIVING THE AWARD EXCEPT FOR THE AGENCY'S IMPROPER ACTION. M.L. MACKAY & ASSOCIATES, INC., B-208827, ID. IN VIEW OF OUR CONCLUSIONS ABOVE, THE CLAIM IS DENIED.